evaluation of the country towns water supply and sewerage

Evaluation of the Country Towns Water Supply and Sewerage Program January 2016

This publication is part of a series summarising program evaluations to enhance the accountability and

transparency of NSW Department of Industry activities The completed program evaluation template is

attached

The Country Towns Water Supply and Sewerage Program

The Country Towns Water Supply and Sewerage (CTWSS) Program provides assistance to Local Water

Utilities (LWUs) that provide public water supply and sewerage services to regional areas of NSW outside

the areas of operation of Sydney Water and Hunter Water The two key functions of the program are to

promote adoption of better practices through leadership guidance training and expert advice to the 105 LWUs (mainly local government councils) oversee and monitor LWUsrsquo performance and

provide financial assistance towards the capital cost of water supply and sewerage infrastructure backlog works to bring water supply and sewerage services up to prevailing standards to meet the 1996 population demands (backlog requirements)

Objective

In the absence of government intervention there would be an underinvestment in safe water supply and

sewerage services in regional towns due to the lack of economies of scale remoteness and the small

population base Unsafe water supply and sewerage services may result in adverse health outcomes

which generate costs to both the people affected and the wider economy via productivity losses and costs

to the public health system Avoiding these adverse health outcomes saves public health costs and

associated productivity losses This represents a benefit to the community from the investment in safe

water supply and sewerage services

The objective of the CTWSS Program is therefore to work with LWUs to achieve appropriate affordable

cost-effective and secure water supply and sewerage services in urban areas of regional NSW which

meet community needs protect public health by meeting the Australian Drinking Water Guidelines and

protect the environment by meeting the Environment Protection Authority (EPA) sewage treatment works

licence conditions

This objective is consistent with NSW2021 Goal 21 - Priority Action 2 ldquoDeliver the Country Towns Water

Supply and Sewerage Programrdquo It is also consistent with the NSW Trade amp Investment Strategic Plan

Result 2 ndash Outcome 5 ndash Strategy 2 ldquoDeliver the Country Towns Water Supply and Sewerage Programrdquo

Options

The alternative options for pursuing the objective that were considered in the evaluation of the CTWSS

Program included

the existing program with a total budget (over the 4 year Treasury Cycle) of approximately $976 million (due to sun-set in 2017-18)

extending the existing program to enable it to complete 71 unfunded water and sewerage projects The proposed budget for this Option would be an additional $110 million over a 5 year period (a net present value of approximately $90 million) and

broadening the existing program to address emerging cryptosporidium risks and the impacts of climate variability and environmental flows on security of water supplies in regional towns The extension would be up to 11 years with a yet to be determined cost

Assessment

NSW Department of Industry program evaluations compare the efficiency and effectiveness of alternative

options with that of the existing or proposed program This involves an assessment of the costs and

Evaluation of the Country Towns Water Supply and Sewerage Program

benefits of each option relative to the base case of lsquono programrsquo and where these benefits and costs have

been quantified a comparison of the net benefit and benefit-cost ratio (BCR) of each option

Quantitative analysis has convincingly demonstrated that both Option 1 and Option 2 provide benefits to

the community in excess of their costs The preferred option was Option 2 extending of the existing

CTWSS Program for a further 5 years to 2022 Option 2 would continue to provide expert advice technical

support and training to LWUs and financial assistance to LWUs towards the capital cost of 71 remaining

unfunded water and sewerage backlog projects

Option 3 would address emerging cryptosporidium risks and the impacts of climate variability and

environmental flows on security of water supplies This option warrants further development and analysis

of its likely costs and benefits

Cost recovery

The evaluation assessed the existing program pricing arrangements relative to the cost recovery

principles outlined by the Productivity Commission in its 2001 Inquiry Report on Cost Recovery by

Government Agencies The evaluation found that the provision of technical support and financial

assistance is in response to the positive externalities from providing strategic planning expert technical

advice and the achievement of desired minimum health standards through infrastructure provision

Application of the Productivity Commissionrsquos cost recovery principles to the existing program indicates that

this program should continue to not be cost recovered This finding would likewise apply to Option 2

Performance Measures

Key performance measures and indicators measure program performance and progress towards meeting

government policy objectives They demonstrate how effective a program is in producing the required

outputs and achieving the desired outcomes

A number of output and outcome performance measures are proposed for the CTWSS Program These

measures are based on achieving the prescribed positive externalities (due to the public good market

failure) of providing assistance to LWUs to achieve minimum water related health standards through

effective and efficient service provision Examples of the Programs outcome measures and indicators

include the

water supply coverage () and sewerage coverage () in regional NSW

number of people benefiting from improved water supplysewerage systems under the program

proportion of LWU microbiological samples complying with Australian Drinking Water Guidelines and

proportion of urban population in regional NSW with an Australian Drinking Water Guidelines compliant public drinking water supply

Future Evaluations

This is the first evaluation of the CTWSS Program as part of the regular Departmental cycle of evaluations

informed by the NSW Government Evaluation Framework As such the evaluation concentrated on the

qualitative aspects of lsquoformativersquo evaluation to build the capacity of program management to monitor

programrsquos performance in the future ndash problem identification program logic and performance measure

design Data collection continues to enable quantitative lsquosummativersquo evaluation of the Program when it is

next scheduled for evaluation under the Framework

More information

Further information on the CTWSS Program can be obtained from

DPI Water Postal address NSW DPI Locked Bag 5123 Parramatta NSW 2124 Phone 1800 353 104 Email waterenquiriesdpinswgovau Website httpwwwwaternswgovauurban-watercountry-town-water

INT1652743 copy State of New South Wales through the NSW Department of Industry Skills and Regional Development 2016 You may copy distribute

and otherwise freely deal with this publication for any purpose provided that you attribute the NSW Department of Industry Skills and Regional

Development as the owner

Disclaimer The information contained in this publication is based on knowledge and understanding at the time of writing (January 2015) However

because of advances in knowledge users are reminded of the need to ensure that information upon which they rely is up to date and to check currency

of the information with the appropriate officer of the NSW Department of Industry Skills and Regional Development or the userrsquos independent advisor

2 NSW Department of Industry January 2016


Attachment Program Evaluation Template

Division Primary Industries (Water)

Program (Current) Country Towns Water Supply and Sewerage Program

Step 1 - Issue or Challenge and Objectives

a Describe the issue or challenge that the program aims to address That is why should the department intervene What would happen in the absence of the program

Without safe and secure urban water supply and sewerage services water-borne diseases

like gastroenteritis are more prevalent and can result in potentially fatal adverse health

impacts The high level of public health protection and environmental benefits resulting from

sound water supply and sewerage services is universally recognised and is the driver for

investment in such infrastructure by many governments

As urban water supply and sewerage is the most capital intensive industry in a western

economy the lack of economies of scale remoteness and the small population base make

servicing rural towns unaffordable without significant government financial assistance

b Identify the groups that would be affected by the issue or challenge without departmental involvement (individuals industry or community)

1 Water users without adequate safe secure water supply and sewerage services would continue to be at risk of water-borne diseases like gastroenteritis

2 Local Water Utilities (LWUs) in regional NSW could not afford to provide safe water supply and sewerage services to all eligible communities

3 The NSW community would continue to incur the public health and environmental costs and associated productivity losses from avoidable water pollution prevention measures and water-borne diseases like gastroenteritis

4 Businesses in country NSW towns would incur increased business costs and reduced competitiveness Regional areas would become less attractive for employers to set up operations which would discourage decentralisation

5 NSW country towns would become a less attractive destination to visitors especially overnight visitors as high operating cost would make regional areas a more expensive tourism destination

c Quantify the impact of the issue in the absence of departmental involvement - the severity of the issue should be demonstrated with quantitative data where possible on the significance and consequences of the issue or challenge in the absence of departmental involvement If no such lsquocostrsquo estimate exists proxy information can be provided to give an indication of potential lsquoscalersquo such as industry value of production

In the absence of departmental involvement over 320 water supply and sewerage projects

which have delivered enhanced public health environment and security of supply outcomes

to over one million people living in country NSW would not have been built As a result

approximately one million people across NSW would have substandard water supply and

sewerage systems that would not meet the 2011 Australian Drinking Water Guidelines

(ADWG) or the NSW Environment Protection Authorityrsquos sewage treatment license

requirements



The benefit of an intervention that improves the safety of water supply and sewerage

systems is reflected in a reduced incidence rate of water-borne diseases like gastroenteritis

which in turn leads reduced expenditure on healthcare reduced productivity losses with

respect to work school attendance and household activities and a reduced cost of mortality

A recent Trade amp Investment Cost-Benefit (CBA) Analysis study (Appendix C) found that the

total avoided cost in NSW from reduced gastroenteritis cases was estimated to be $957 per

case in 2013-14 prices1 This cost per case multiplied by the reduction in casesperson per

year yields the estimated reduced cost per person Thus the benefit associated with

improved water and sewerage systems (solely from reduced cases of gastroenteritis) would

be a reduction in total costs of $303 per head of population covered by each project

Further it could be expected that tourism operators and other businesses (related to or

reliant on tourism) in country NSW towns would suffer in the absence of government

intervention NSW country towns could become a less attractive destination to visitors

especially overnight visitors as high operating costs would make regional areas a more

expensive tourism destination Also the reduced provision of safe water facilities may act to

reduce the competitiveness of businesses as regional areas would become less attractive for

employers to set up operations

In total the Trade amp Investment CBA reveals that a potential avoided cost for future projects

of $174 million (net present value) could be achieved by pursuing an option involving

government intervention This value has been calculated including health impacts the

management and replacement costs of the existing water and sewerage infrastructure and

the estimated household expenditure involved in securing their own safe water supply or

sewerage disposal

Further Evidence supporting the Impact of absence of a CTWSS Program or similar

Possible impacts of the absence of the CTWSS Program are illustrated by the following

Walkerton Ontario Canada where 7 people died and half of the townrsquos population of 4000 were severely ill as a result of faecal contamination of the public water supply This had a major impact for the province of Ontario where a total remedial expenditure of $500 million was required2

Tasmania where over 20 towns had permanent boil water alerts most water suppliers did not have pay for use pricing or full cost recovery and there is minimal public reporting of water utility performance

Queensland where water supply and sewerage services provided by over 70 councils have minimal public reporting of drinking water quality water supply tariffs or cost recovery There is significant evidence of poor drinking water quality and of poorly coordinated major capital investments due to the absence of the Section 60 type approval processes3 and strategic business planning and integrated water cycle management (IWCM) strategies

The NSW Auditor Generalrsquos Performance Audit of the Country Towns Water Supply and

Sewerage Program (May 2015) found that the Program

has helped improve the performance of LWUs

1 NSW Trade amp Investment (2014) Country Towns Water Supply and Sewerage Program Cost-Benefit Analysis

of Unfunded Backlog Projects Unpublished October 2014 (Appendix C) 2

Dr Steve Hrudey ndash Water and Public Health Workshop Sydney 11 May 2006 26 February 2015 3

The independent Section 60 reviews by the NSW Office of Water provides assurance that any proposed LWU water and sewage treatment works or dams are safe lsquoright sizedrsquo fit-for-purpose and cost-effective Such infrastructure provides a robust soundly based solution without wasteful lsquogold platingrsquo



has effectively promoted adoption of better management practices by LWUs

has made a financial contribution to the building of water supply and sewerage infrastructure in country towns

has reduced the 1996 backlog of projects and

has targeted only genuine backlog works and that these projects were fit-for-purpose

Page 23 of the NSW Auditor-Generalrsquos Report is shown in Appendix A on page 21

In addition page 26 of the NSW Auditor-Generalrsquos Report states that

lsquoFeedback from LWUs to the audit was that they found the performance monitoring and reporting particularly the benchmarking useful in identifying improvement opportunities

The Productivity Commission (2011) has also commended NOW (NSW Office of Water) for its data-auditing approach

In 2013 NOW commissioned an audit of the NSW performance monitoring system to assess its effectiveness in mitigating high inherent risks related to

and Sewerage Framework

contamination or pollution

The audit found that the system appears to be effective in mitigating these risksrsquo

d Describe who or what created the issue or challenge Examples include specific industry participants (such as producers or consumers) and environmental factors (such as the effect of climate change)

The benefits of safe water supply and sewerage services are universally recognised

However due to the lack of economies of scale and remoteness the cost per premises is

much higher for regional communities As a consequence there is no incentive for private

providers or local councils to invest in water and sewerage infrastructure because of the

prohibitively high capital cost and improbability of being able to recover these costs from the

residents This has resulted in many of these communities missing out on the collective

provision of safe water supply and sewerage services due largely to the high cost per

premises of installing the required infrastructure

e List current programs or legal instruments (provided by industry or any level of government) which aim to address the issue or challenge Could these be altered to address the issue or challenge

Other Programs Able to be altered

Sydney Water and Hunter Water Service the metropolitan areas of the Sydney and Hunter Regions in accordance with their Acts

Yes although impractical the Acts could be altered to give Sydney Water and Hunter Water responsibility for all non-metropolitan urban areas of NSW

Local Government Under DPI Waterrsquos Best Practice Management of Water Supply and Sewerage Framework LWUs (ie Local Government) are required to achieve best practice provision including the determination of service and pricing levels based on long term strategic business planning and full cost recovery principles

No ndash Local Government does not have the required resources to fund the required infrastructure nor provide the appropriate coordinated planning pricing and technical expertise to achieve these outcomes



There are no other current Programs within State Government that specifically provide the services and support that the CTWSS Program delivers

Not applicable

f Identify who might benefit if action [such as the program being evaluated] is taken by the department

Who are the primary beneficiaries

Water users currently without adequate safe water supplies and sewerage services (but who would receive adequate safe water supplies and sewerage services as a result of the program) would benefit from a reduced risk of water-borne diseases like gastroenteritis

Who else might benefit

The NSW community would benefit from lower public health costs and associated productivity losses from avoidable water-borne diseases like gastroenteritis

Water utilities in regional NSW would benefit from providing safe water supplies and sewerage services to all eligible communities

Towns in regional NSW would benefit from becoming more attractive destinations for visitors residents and businesses after gaining safe water supplies and sewerage services

Industries dependant on water services (eg fisheries oyster hatcheries regional development)

61 discrete Aboriginal communities also benefit from improved water and sewerage infrastructure under the Aboriginal Communities Water and Sewerage Program as that Program is serviced by technical specialists from the CTWSS Program

g Determine whether there might be a role for the department in addressing the perceived issue or challenge ndash ie what high-level objectives might a potential program achieve

Objective Working with LWUs to achieve appropriate affordable cost-effective and secure

water supply and sewerage services in urban areas of regional NSW which meet community

needs protect public health by meeting ADWG and protect the environment by meeting EPA

sewage treatment works licence conditions

Policy Alignment

a NSW 2021 goal4

NSW2021 Goal 21 ldquoSecure potable water suppliesrdquo Priority Action 2 ldquoDeliver the Country

Towns Water Supply and Sewerage Program which supports the provision of water and

sewerage services including administering funding for priority water and sewerage

infrastructure providing emergency drought assistance reviewing performance of utilities

and advising on improved operation of utilities managing dams weirs and water and sewage

treatment facilitiesrdquo

a NSW Trade amp Investment Strategic Plan outcome

NSW TampI Strategic Plan Result 2 ldquoPositive business environment in NSWrdquo Outcome 5

ldquoEnergy and regional water supplies and services are reliable efficient and sustainablerdquo

Strategy 1 ldquoRegulate and monitor regional water supplies to meet reliability and performance

standards for water continuity and qualityrdquo and Strategy 2 ldquoDeliver the Country Towns Water

Supply and Sewerage Program which supports the provision of water and sewerage

servicesrdquo

NSW State Priorities (NSW Making it Happen) have since replaced NSW 2021


4


Market Failure Unsafe water supply and sewerage services result in adverse health outcomes which

generate costs to both the people affected and the wider economy via productivity losses

and costs to the public health system Avoiding these adverse health outcomes saves public

health costs and associated productivity losses This represents a positive externality from

the investment in safe water supply and sewerage services

In most regional communities the private benefits from investing in safe water supply and

sewerage services are not sufficient to justify this investment This results in less investment

in safe water supply and sewerage services than is socially optimal Where the total benefit

(private + public) is greater than the total cost of providing safe water supply and sewerage

services it would be efficient to encourage this provision assuming there was an efficient

and equitable means of funding such provision

Social Equity Goal Safe water supply and sewerage services while universal in metropolitan areas may not be

available to communities in regional NSW Access to appropriate and affordable water

supply and sewerage services can help reduce other disadvantages that these communities

may face Safe water supply and sewerage services for remote Aboriginal communities have

been identified as a particularly important equity issue



Step 2 ndash Program Options amp Design

Identify all potential options for achieving the objective including those that least impede business activity

Option 1

The existing

CTWSS

program

Description

DPI Water manages and administers the Country Towns Water Supply and

Sewerage (CTWSS) Program a major government reform program that has two

broad elements

promote adoption of better practices through leadership guidance training and expert advice to the 105 LWUs (mainly local government councils) and monitor LWUsrsquo performance and

financial assistance towards the capital cost of water supply and sewerage infrastructure backlog works to bring water supply and sewerage services up to prevailing standards to meet the 1996 population demands (backlog requirements)

The utilities include all regional councils in NSW providing public water supply

and sewerage services These utilities are outside the areas of operation of

Sydney Water and Hunter Water

The objective of the CTWSS Program is to work with LWUs to achieve

appropriate affordable cost-effective and secure water supply and sewerage

services in urban areas of regional NSW which meet community needs protect

public health by meeting ADWG and protect the environment by meeting EPA


In return for State Government funding LWUs need to implement the best

practice management principles encapsulated in the NSW Best-Practice

Management of Water Supply and Sewerage Framework

(wwwwaternswgovau) The Framework requires the utilities to prepare and

implement a 30-year strategic business plan total asset management plan and

financial plan sound water supply amp sewerage pricing developer charges trade

waste policy approvals and pricing water conservation drought management

annual performance monitoring and an IWCM strategy

The activities performed by the CTWSS Program staff to ensure that LWUs

implement the requirements of the Best Practice Management Framework and

statutory requirements under the National Water Initiative 2004 and the Local

Government Act 19935 are ongoing regardless of funding for capital projects

Through the CTWSS Program DPI Water

The requirements include

Annual Performance Monitoring (National Performance Framework 2014)

Sound pricing of water supply sewerage and trade waste (COAG Strategic Framework for Water Reform National Competition Policy National Water Initiative (NWI) 2004 NWI Pricing Principles 2010)

Section 60 approval [Local Government Act 1993] of any proposed LWU dams and water and sewage

treatment works

Section 61 inspections [Local Government Act] of LWU dams and water and sewage treatment works

(ADWG 2011 National Certification Framework of Water Treatment Operators 2014 National Water Quality Management Strategy National Sewage Quality Management Framework 2012) and

IWCM Strategy total asset management plan and financial plan (National Urban Water Planning Principles 2008)


5


1 provides leadership guidance training and expert advice to the 105 LWUs (generally local government councils) to assist them to implement the 19 requirements of the Best-Practice Management of Water Supply and Sewerage Framework

2 oversees monitors and publicly discloses the State-wide performance and the performance of each utility

3 provides expert advice to LWUs on strategic planning IWCM total asset management planning (TAMP) financial planning pricing management operation maintenance and procuring infrastructure

4 manages water and sewage treatment and dam safety programs to ensure the safe effective and efficient management of the 539 LWU water and sewage treatment works and 116 LWU dams and weirs and that any such new specialist infrastructure is safe lsquoright sizedrsquo fit-for-purpose and cost-effective

5 provides financial assistance to LWUs towards the capital cost of works to address the backlog in secure water supply and sewerage infrastructure (subject to a means test) Backlog relates to infrastructure necessary to meet the demand loads service standards and regulatory requirements that existed in 1996 Each utility is responsible for operation and maintenance costs and capital costs to meet population growth asset replacement and renewal and changes in standards or requirements post 1996 As a result in general terms for each dollar contributed by the State Government towards a project the LWU contributes two dollars The State Government contributes the standard 50 of the capital cost for small LWUs (with annual water and sewerage revenue lt $10 million) and 20 for large LWUs with greater revenue and

6 provides technical and financial assistance to LWUs to maintain essential water supplies in periods of drought

Resourcing requirements

The CTWSS Program has a number of activities each with a staff establishment Overall the Program has 51 approved full time positions comprising6

CTWSS Program management 5

Finance and administration 3

Policy 3

Dam safety 2

Water amp Sewerage Process specialists3

Regional Water and Sewerage Treatment Officers 11

Regional staff 10

Manager Aboriginal Communities WampS Program 1

Water Utility Performance (Utility Performance Planning IWCM Trade Waste) 13

Note 4 of Program staff are funded by the Aboriginal Communities Water and Sewerage Program

Funding arrangements

In the 2014-15 State Budget the CTWSS Program was allocated $461 million

Of this amount $39 million is for capital grants The remaining $71 million is

allocated for Program management as well as funding of the other activities

listed in the Resource requirements above The program is due to sunset in

2017-18

6 Note that 12 of these positions are presently vacant with recruitment underway for 4 of the positions



Current Treasury forward allocations for the grants program for the current 4

year Treasury Cycle are

2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0

Governance arrangements

Financial management of the Program is reported to NSW Treasury

The appropriate level of backlog subsidy for each capital works project is

assessed by Program officers based on design capacity and population figures

provided by the LWUs This assessment is scrutinised by a Subsidy Review

Board (SRB) within DPI Water and the assessed level of subsidy is either

supported or additional information is sought

The SRB process ensures consistency of subsidy assessment across all

projects and ensures the projects are not ldquogold-platedrdquo and represent value for

money on the basis of social environmental and economic considerations

All funding offers to LWUs are made by the Minister responsible for the

Program and the relevant Local Government Mayor Chairman and General

Manager sign the Conditions of Offer document for the funding

Furthermore the New South Wales Auditor-Generalrsquos Performance Audit Report

found that since 2004 the CTWSS funding allocation has improved through the

adoption of prioritisation and means testing the linking of funding to the

adoption of better practices and tighter funding agreements and better

management of project costs

Consultation strategy

Consultation with Local Government NSW NSW Water Directorate LWUs

NSW Health the Environment Protection Authority (EPA) Planning and

Environment Infrastructure NSW the Dams Safety Committee (DSC) and other

relevant bodies and authorities is undertaken on a regular basis to ensure the

Programrsquos objectives are being delivered effectively and efficiently

Consultation with NSW Treasury occurs on a regular basis to enable budgetary

processes to be fully informed of predicted expenditure profiles re-profiling

where necessary and on occasions when funding is limited individual project

expenditure can be deferred

Existing or proposed program pricing strategy

The Program is closely controlled to deliver the scheduled projects within the

approved budget

For lsquocost recoveryrsquo purposes there are two distinct program components

provision of technical support and provision of financial assistance

Technical Support

The provision of technical support is in response to the positive externalities that



the NSW Government is able to realise by providing strategic planning and

expert technical advice in the provision of such utilities Being that the advice

offered provides government planning health and allocative efficiency benefits

beyond the scope of the individual LWUs the government funding to provide

such services is deemed to be non cost-recoverable

Application of the Productivity Commissionrsquos cost recovery principles to the

technical support indicates that the costs should not be recovered The pathway

through the Cost Recovery Decision Framework (Appendix B) is as follows 1

2b 3 4 9a 9b 11 12 recommending provision with no cost recovery

The benefit of technical support is assumed to accrue to the broader NSW

public (as opposed to the residents of individual LWUs) by allowing the LWUs to

realise health benefits for the wider population and accommodate future

potential regional development As such it is assumed that the major

beneficiaries are not a narrow identifiable group (9a) and neither are the

identifiable minor beneficiaries able to capture enough benefits to warrant

paying for the provision (9b)

Financial Assistance

The provision of financial assistance is also in response to the positive

externalities that the NSW Government is able to realise on behalf of its

constituents and the welfare considerations of Government (that a minimum

level of water quality be established for all NSW residents) Similarly the benefits

of achieving desired minimum health standards through infrastructure provision

also lies beyond the scope of the individual LWU and as such the government

funding to provide such assistance is deemed to be non cost-recoverable


financial assistance indicates that the costs should not be recovered The

pathway through the Cost Recovery Decision Framework (Appendix B) is as

follows 1 2b 3 4 9a 9b 11 12 recommending provision with no cost recovery

(with the same justifications)

Pricing strategy outside the scope of the Program

Unlike for the NSW Government contribution to this Program at the LWU level

the benefits do apply to the constituents of each LWU Thus at the LWU level it

is likely to be efficient and equitable to achieve an appropriate level of cost

recovery for the provision of services Indeed under the NSW Best-Practice

Management of Water Supply and Sewerage Framework each LWU is required

to achieve best practice pricing including full cost recovery (which involves

achieving at least lsquolower bound pricingrsquo7 and moving towards lsquoupper bound

pricingrsquo where practicable) However the details of such pricing strategies lie

outside the scope of this evaluation

Lower bound pricing is sufficient to ensure the long term financial sustainability of services on the basis of the LWUrsquos existing Typical Residential Bill (TRB) in real terms Utilities electing to pay a dividend from the surplus of their water and sewerage businesses to the Councilrsquos general revenue will be moving towards upper bound pricing which is the maximum level of pricing without invoking monopoly pricing powers


7


Key performance measures

The CTWSS Program provides advice and funding towards appropriate

affordable cost-effective and secure water supply and sewerage services in

urban areas of regional NSW which meet community needs protect public

health by meeting ADWG and protect the environment by meeting EPA sewage

treatment works licence conditions

The key performance measures listed below follow NSW Treasury guidelines

that refer to lsquoresult indicatorsrsquo which are aimed at gauging whether services are

making a positive impact on society Relevant output indicators are also

provided as examples of how the program contributes to higher level

performance measures and indicators

Output measures and indicators

Cumulative number of grants assessed and approved Target of 549 by 2016-17

Cumulative number of construction projects completed Target of 549 by 2016-17

Number of independent assessments (Section 60 reports) completed for proposed dams water and sewage treatment works and recycling projects to ensure they are lsquoright sizedrsquo fit-for-purpose cost-effective meet public health safety and environmental requirements Target of 20 per year

Number of inspections of Water Treatment Works Sewage Treatment Works to assist in the safe effective and efficient management of the 539 LWU water and sewerage treatment works (target of 600 per year) amp 116 LWU dams amp weirs (target of 30 per year)

Timely completion of the annual program reports including the NSW Water Supply and Sewerage Performance Monitoring Report the NSW Benchmarking Report and LWU TBL Performance Reports

Outcome measures and indicators

Water supply coverage () amp sewerage coverage () in regional NSW Targets of 980 and 962 by 2016-17 respectively

Number of people benefiting from improved water supplysewerage systems under the program Target of 1050000 by 2016-17

Proportion of LWU microbiological water samples complying with ADWG (health related) Target of 995 of samples tested

Proportion of urban population in regional NSW with ADWG compliant public drinking water supply Target of 98 (by 2016-17)

Proportion of LWUs meeting ADWG Target of 98 (by 2016-17)

Proportion of LWUs complying with EPA sewage treatment licence conditions for Biochemical Oxygen Demand and Suspended Solids Targets of 85 and 75 respectively (by 2016-17)

Sound planning pricing and management by LWUs with 90 of the overall requirements of the Best-Practice Management of Water Supply amp Sewerage Framework met by LWUs



Option 2

Extended

CTWSS

Program

Description

This option would see the Government allocate funds in the forward estimates to the CTWSS Program to enable it to complete the remaining 71 unfunded water and sewerage projects on the 2002 infrastructure list This differs from Option 1 in that the CTWSS is continued instead of sun-setting in 2017-18

Background

In 2002 there were 123 unfunded backlog projects in the CTWSS Program Since then a number of LWUs have completed some backlog projects without Government assistance and others have decided not to proceed

As a result towards the end of 2014 there were 71 unfunded water supply and sewerage backlog projects spread over 50 LWUs in the CTWSS Program These projects which were unfunded due to a shortfall in Program funds as a result of partial indexation since 1996 are all that remain of the original 670 water supply and sewerage backlog projects that had been identified and listed in the CTWSS Program in 2002

The majority of the unfunded 71 water supply and sewerage projects are small infrastructure works to provide reticulated sewerage and water supplies to small disadvantaged under resourced and financially stressed communities currently dependent on septic systems and rainwater tanks

A CBA consistent with the NSW Government Guidelines for Economic Appraisal and prioritisation on 62 of these remaining unfunded projects was conducted by the Strategic Policy and Economics Branch of Trade and Investment (Appendix C)

The CBA revealed that the total capital cost for these 62 projects was estimated to be $318 million with a maximum NSW Government subsidy of $112 million

On this basis 52 (84 per cent) of the projects are estimated to provide a positive return to the NSW Governmentrsquos contribution with a program-wide net benefit (sum of the 62 projects) of $174 million net present value (NPV) with a benefit-cost ratio (BCR) of 154

Taking into account the entire capital cost of each project (LWU plus CTWSSP subsidy) 17 (27 per cent) of the projects are estimated to provide a positive return and the program is estimated to provide a net benefit (sum of the 62 projects) of $37 million (NPV) with a BCR of 101

However the CBA findings are considered to be underestimates because (i) conservative benefit parameters were used (ii) some benefits could not be quantified and (iii) project self-selection will result in only those projects generating net benefits being undertaken The CBA thus recommends that the NSW Government make available the maximum level of contribution ($112 million) under the Program for the identified projects

The Government accepted this recommendation and under the Regional Water and Waste Water Backlog Program has publically committed $110 million towards the remaining 71 water supply and sewerage projects subject to each project undergoing a CBA

Funds have been reserved by Treasury for this and it is anticipated that the remaining relatively small water and sewerage projects will be finished by 2022




Staff numbers required as per Option 1 (extended for an additional 5 years)

Funding requirements are as per Option 1 with an additional Treasury allocation of $110 million to enable this additional work to be completed


As in Option 1


As in Option 1


As in Option 1


As in Option 1 but with targets adjusted to account for the longer program life



Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description

This Option differs from Options 1 and 2 in that in addition to achieving the

outcomes of options 1 and 2 the focus of the CTWSS Program would change to

also address emerging cryptosporidium8 risks and the impacts of climate

variability and environmental flows on the security of water supplies in regional

towns

Additional components commensurate with this focus would be adopted and

incorporated into a new Program that concentrates on ensuring that regional

towns in NSW address emerging cryptosporidium risks and have adequate and

secure water supplies now and into the future

Effective management of cryptosporidium risks is an emerging matter of

concern to water supply and health regulators in both Australia and overseas

Recent modelling by NSW Health and DPI Water has identified the need for

approximately $100 million of capital expenditure by LWUs on water treatment

infrastructure upgrades in order to address the identified cryptosporidium risks in

regional NSW

Research into the effects of climate variability on the security of water supplies

by DPI Water in conjunction with CSIRO and the National Water Commission

has identified an expected reduction of approximately 30 in the secure yield of

water supplies west of the Great Dividing Range in the coming years This

coupled with enhanced environmental flow requirements will substantially

reduce the secure yield of LWU water supply systems

In order to provide appropriate urban water supply security in the face of the

estimated climate variability increased environmental flows and the identified

need for piped transfers from regulated dams over the next 10 years DPI Water

has conducted a secure yield analysis and desktop study of the water security

for 30 regional water supplies which has found that LWUs will need to increase

their current identified and planned for capital works programs of approximately

$11 billion over 30 years by an estimated 30 in order to achieve appropriate

water security for the towns in regional NSW

The grant component and technical advice provided by the current CTWSS

Program would be continued and expanded in Option 3 to include the above

broader Program objective


Staff numbers required as per Option 1 (extended for several more years)

Funding requirements are as per Option 2 with an additional Treasury allocation

yet to be determined over 11 years


As in Option 1


As in Option 1

Cryptosporidium is a single-celled organism that can cause illness in humans primarily involving watery diarrhoea with or without a persistent cough Cryptosporidium is highly resistant to chlorine disinfection


8



As in Option 1 (note some further consideration would be required for the additional functions)



As per Option 1 (with the following alterations)

30-year IWCM Strategy for each LWU in regional NSW which shows that the secure yield with climate variability and appropriate environmental flows for each water supply exceeds the unrestricted annual water demand




Number of people benefiting from improved water supplysewerage systems Target of 1500000 by 2026-27

All regional urban water supplies to have addressed emerging cryptosporidium risks to assure safe drinking water supplies (Drinking Water Management Systems prepared and implemented under the Public Health Act 2010 and Australian Drinking Water Guidelines) by 2026-27

All regional urban water supplies to have appropriate water security by addressing climate variability amp environmental flows by 2026-27

Sound planning pricing and management of water supply and sewerage by LWUs with all of the requirements of the Best-Practice Management of Water Supply amp Sewerage Framework met by the LWUs by 2026-27



Step 3 ndash Options Assessment

Shortlist options by qualitatively listing below the benefits and costs to the citizens of NSW of each option relative to the base case of lsquono programrsquo If the program contains sub-components it may be easier to consider the benefits and costs of each subcomponent

Benefits Costs Qualitative assessment of net

impact

Option 1 1050000 people in regional areas benefiting from improved water supplysewerage systems through reduced risk of water-

Grants program 2014-15 $39016M

Benefit Cost Ratio gt 1 Benefits significantly outweigh costs to community

The existing borne diseases like gastroenteritis This contributes to 2015-16 $29661M and Government CTWSS lower public health costs and associated employment 2016-17 $28948M program

productivity losses

tourism benefits for regional centres

decreased private industry water infrastructuretreatment costs (water treatment costs water tanks sewerage costs)

health and community benefits to 61 discrete Aboriginal communities

more viable LWUs providing quality (reasonably priced) service from the subsidised provision of safe water supplies and sewerage services to all eligible communities

NSW2021 Goal 21 Priority Action 2 achieved

NSW TampI Strategic Plan Result 2 ndash Outcome 5 ndash Strategy 2 achieved

environmental benefits

2017-18 $0 Total of $9764M

(a Net Present Value has not been calculated because many of the costs have already been incurred)

This is not the preferred option because although the benefits significantly outweigh the costs many of the high return projects have already been undertaken in keeping with the prioritisation schedule This leaves the remaining projects as those with expected lower returns Furthermore this program is due to sunset in 2017-18

Option 2

Extended CTWSS Program

As per Option 1 with the extension of these benefits to include the remaining 71 previously unfunded water and sewerage projects on the 2002 infrastructure list

Allows for the timely establishment and proven quality of provision for the proposed $110 million program that has already achieved commitment from the government

As per Option 1 with the addition of $110 million over a 5 year period (a Net Present Value of approx $90 million)

Benefit Cost Ratio gt 1 (in the vicinity of 101 to 154)

Benefits outweigh costs to community and Government

Option 2 is the preferred option because although the net benefit is not expected to be as great as for Option 1 (due to the prioritisation of high return projects having already been undertaken) the current program (Option 1) is due to sunset in 2017shy18 and Option 2 provides the next best investment opportunity



Option 3

Broadened CTWSS Program to address cryptosporidi um risks and water security

As per Option 2 with the addition of addressing emerging cryptosporidium risks and maintaining urban water security in the face of climate variability and increased environmental flow requirements in order to assure the ongoing viability of towns and associated commerce and industry in regional NSW

Many of the benefits listed in Options 1 and 2 will be realised (but with greater measure) for Option 3 This includes


tourism benefits

increased regional development

reduced industry infrastructure

Additional benefits include

emerging cryptosporidium risks addressed in order to protect the community and businesses in regional NSW

continued viability of towns cities and industries in regional NSW assured through the resulting appropriate urban water security

reduced number and length of time of water restrictions in regional towns increasing quality of life

development of stronger drought resilient infrastructure leading to a reduction in government drought assistance to rural towns

population growth in these urban centres with the associated follow-on economic activity and improved employment within the region

alleviate impacts of climate variability and the need for increased for environmental flows

As per Option 2 with an additional yet to be determined cost

Option 3 would address emerging cryptosporidium risks and the impacts of climate variability and environmental flows on security of water supplies This option warrants further development and analysis of its likely costs and benefits

Option 3 while still in the developmental stage appears to cost-effectively provide the necessary water quality protection and urban water security to assure the ongoing viability of towns commerce industry and associated high security water users in regional NSW

Option 3 is not currently the preferred option



Appendix A - The NSW Auditor Generalrsquos Performance Audit of the Country Towns Water Supply and Sewerage Program (May 2015) page 23



Appendix B ndash Cost Recovery Decision Framework


Appendix C

Country Towns Water Supply and Sewerage Program

Cost-Benefit Analysis of Unfunded Backlog Projects

Executive Summary

The majority of the Country Towns Water Supply amp Sewerage Program (CTWSS) run by the Office of Water involves NSW Government contributions towards the lsquo1996 backlog componentsrsquo of sewerage and water quality infrastructure project capital works All funds have now been committed to 2016-17 leaving 77 unfunded projects After excluding 11 water security projects and 4 Hunter Water Corporation projects a cost benefit analysis (CBA) was conducted on the remaining 62 projects in order to determine the net benefits arising from the program as a whole

For each project the costs considered include

capital costs and

ongoing operation maintenance and administration (OMA) costs after the capital work

has been completed

For each project the benefits considered include

health benefits in the form of reduced incidence of gastroenteritis from improved

standards of water supply and sewerage resulting in reduced

o healthcare costs

o productivity losses

o mortality costs

the residential bill charged by Local Water Utilities (LWU) that cover the ongoing OMA

costs and the current replacement cost depreciation and

the avoided household expenditure to secure their own safe water supply or sewerage

disposal after the projects are implemented

Note that maintenance costs and the LWU residential bills are effectively a transfer and cancel each other out in the program-wide analysis Costs and benefits that have not been quantified include

environmental damage and

the risk of epidemicsgastroenteritis outbreaks

Total capital costs for the 62 projects are estimated to be $318 million and the maximum NSW Government subsidy is $112 million

The counterfactual for this CBA is lsquono programrsquo that is no subsidy will be made available to LWUs for the 62 projects in the absence of the CTWSSP and that these projects will not be undertaken without such a subsidy On this basis 52 (84 per cent) of the projects are estimated to provide a positive return to the NSW Governmentrsquos contribution with a program-wide net benefit (sum of the 62 projects) of $174 million (net present value) with a benefit-cost ratio (BCR) of 154

Taking into account the entire capital cost of each project (LWU plus CTWSSP subsidy) 17 (27 per cent) of the projects are estimated to provide a positive return and the program is estimated to provide a net benefit (sum of the 62 projects) of $37 million (NPV) with a BCR of 101 However caution is recommended when considering this estimate as each LWU will decide whether or not individual projects will proceed based on its assessment of the projectrsquos net benefits from the local communityrsquos perspective As LWUs are best placed to make such assessments it is probable that many projects will be deemed by LWUs to generate benefits that were not able to be quantified in this analysis Consequently LWUs may choose to proceed with some projects that have been estimated here to result in net costs in cases where LWUs decide that total project benefits exceed costs Hence the proportion of projects that yield positive net benefits is likely to have been underestimated above

Similarly the estimated total program net benefit estimates above are also likely to be underestimated as they assume that all 62 projects will be undertaken The fact that LWUs

ultimately decide which projects proceed will likely result in the ex post program net benefit rising as those projects with the greatest net benefits are most likely to be undertaken while those with the greatest net costs are less likely to be undertaken Hence project self-selection by LWUs will improve overall program net benefits

As the above estimates are considered underestimates because (i) conservative benefit parameters were used (ii) some benefits could not be quantified and (iii) project self-selection will result in only those projects generating net benefits being undertaken it is recommended that the NSW Government make available the maximum level of contribution ($112 million) under the Program for the 62 identified projects

xxiii NSW Department of Industry January 2016

Contents Contents xxiv

Background 25

Cost Benefit Analysis Framework Assumptions and Options 26

Suitability of Projects 26

Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27

Incidence Rate of Gastroenteritis 28

Reduced Costs of Gastroenteritis 28

Summary of Reduced Costs of Gastroenteritis 31

Residual Value 31

Avoided Household Expenditure 31

Additional Unquantified Benefits 32

Indexation and Discount Rate 33

Analysis Period 34

Results and Discussion 34

Sensitivity Analysis 35

Recommendation 36

Appendix C1 ndash CBA Results 37

Appendix C2 ndash Individual Project NPV Chart 40

Bibliography 42

xxiv NSW Department of Industry January 2016

Background

The Country Town Water Supply amp Sewerage (CTWSS) Program9 is a major reform State Government program for Local Water Utilities (LWUs) in regional NSW (generally local councils) to achieve appropriate affordable cost-effective and sustainable water supply and sewerage services

The Program provides leadership and guidance to local water utilities in best practice planning pricing management operation and maintenance of their water supply and sewerage systems In addition financial assistance is provided towards the cost of capital works required to meet population demands andor prevailing standards as at 1996 Funding is not provided for works needed as a result of population growth or regulatory changes since that time nor for operation or maintenance expenses or renewal or rehabilitation of infrastructure

The LWUs are required to plan price manage operate and maintain their water supply and sewerage systems in accordance with the 19 requirements of the comprehensive NSW Best-Practice Management of Water Supply and Sewerage Framework (wwwwaternswgovau)10 This ensures that any projects undertaken are fit for purpose do not involve lsquogold platingrsquo provide value for money and have strong community support11 In addition the Framework requires the utilities to achieve full cost recovery for their water and sewerage services and to provide strong pricing signals to encourage efficient use of the services

In 2004 all existing projects were prioritised on agreed transparent criteria based on public health environmental and security of supply risks No new projects have been admitted to the Program since 2004 All funds ($1227 million) are now fully committed to 2016-17 and there remain 77 unfunded backlog projects listed under the program12 As a result there is considerable inequity in regional NSW between those local water utilities that have secured funding (often the better resourced utilities) and those that have not secured funding

This report summarises the results of a preliminary cost-benefit analysis (CBA) of infrastructure upgrades needed to complete the majority of the 77 unfunded projects to assist the prioritisation of this work in line with the Governmentrsquos response to Infrastructure NSWrsquos 2013 State Infrastructure Strategy

9 Key achievements of the Program include providing a reticulated water supply to a population of 181 million and sewerage to population of 169 million in regional NSW The coverage provided is 980 of the urban population for water supply and 956 for sewerage

10 It is important to note that the 2012-13 NSW Water Supply and Sewerage Performance Monitoring Report (wwwwaternswgovau) shows that the regional NSW local water utilities are continuing to lead the way in Australia in providing appropriate cost-effective and affordable water supply and sewerage services to the community The regional NSW utilities now have among the most efficient residential water use in Australia (a Statewide median of 166kLconnected property) and all of the utilities are achieving full cost recovery for water supply with 96 achieving full cost recovery for sewerage

11 A pre-requisite for any project proceeding to implementation under the Program is support for the project by the LWU and its community including achieving full cost recovery on a whole of life cycle basis This provides assurance that only projects which are valued by the LWU and the community and which will achieve full cost recovery will be implemented

12 Each of these backlog projects supports the basic human rights of residents for access to adequate water and sanitation as well as achieving NSW 2021 Goal 21 for secure potable water supplies and appropriate sewerage services in regional NSW

25

Cost Benefit Analysis Framework Assumptions and Options

This economic analysis is consistent with the NSW Government Guidelines for Economic Appraisal (TTP07-5) The net benefit or cost of the proposed projects is estimated from the perspective of all NSW residents (the referent group)

To estimate the economic impact of a project the outcome for each option is estimated and compared to the status quo or base case (the lsquocounterfactualrsquo) That is the outcome for the referent group if the project were to proceed is compared with the outcome for the referent group if the project does not proceed Given that the need for the projects was determined as early as 1996 but no action has been taken by individual LWUs the counterfactual assumes that in the absence of government support the projects will not take place

The difference between the project option and the counterfactual provides an estimate of the net benefit or cost of that option

Suitability of Projects

The methodology used to value the benefits of the CTWSS program is based in part on identifying the improved health status of the residents of the communities in question and hence relies on estimating the reduced medical costs and productivity losses due to a decline in incidences of gastroenteritisdiarrhoea from waterborne sources

Of the 77 unfunded projects 11 projects have been excluded from this CBA as they do not seek to redress water supply or sewerage systems that pose a health risk due to the presence of pathogens that may lead to gastroenteritisdiarrhoea An additional 4 projects belonging to the Hunter Water Corporation have also been excluded at the request of Infrastructure NSW In total the estimated total capital cost of the excluded projects is $853 million and the maximum possible NSW Government subsidy for these projects is $289 million

The excluded projects and their respective LWUs are

1 Angledool Water Supply ndash Bore Brewarrina Shire Council

2 Bourke Water Supply Sludge Management Bourke Shire Council

3 Brewarrina Sewerage Effluent amp Water Supply Sludge Management Brewarrina

Shire Council

4 Carrathool Water Supply Carrathool Shire Council

5 Cowra Water Supply Sludge Management Cowra Shire Council

6 Dunedoo Sewerage Warrumbungle Shire Council

7 Manning District Water Supply Stage 2C (Dam) MidCoast County Council

8 Moree Water Supply Augmentation Moree Plans Shire Council

9 Narrandera Water Supply Narrandera Shire Council

10 Spring Hill Lucknow Water Supply Orange City Council

11 Yass Water Supply ndash Treatment Yass Valley Council

12 Dungog Villages Water Supply Hunter Water Corporation

13 Paterson Sewerage Hunter Water Corporation

14 Gresford Sewerage Hunter Water Corporation

15 Vacy amp Martins Creek Sewerage Hunter Water Corporation

These exclusions leave 62 projects that are associated with water supply quality sewerage systems and meeting National Health and Medical Research Council (NHMRC) Guidelines health criteria A full list of analysed projects is available in Appendix C1

26

Program Costs

Capital Costs

The Office of Water has estimated the total cost in 2014 dollars of each project with each project including a backlog component LWUs are eligible for NSW Government subsidies for only a portion of the backlog component of the work Over the life of the Program the Government has contributed approximately 30 towards the total capital costs of projects (subject to a means test) and local water utilities have contributed the remaining 70

Under the rules of the CTWSS Program the maximum level of Government subsidy towards projects to upgrade existing sub-standard systems is 20 of the backlog component for large local water utilities with a turnover of $10 million and 50 for smaller local water utilities with a revenue turnover of less than $10 million However a subsidy of 50 is provided towards the capital cost of servicing un-serviced towns as these projects would otherwise be unaffordable

The estimated total capital cost for the 62 projects is $318 million The maximum NSW Government subsidy is $112 million which is equivalent to 35 of the total capital cost

For the purposes of this CBA it has been assumed that the total capital cost13 of each project is the actual cost of construction and that the maximum Government contribution is made It is also assumed that all capital costs are incurred in a single year of construction beginning in 2016-17 While this is unrealistic as the Program if extended would fund projects over a number of years there is no way of knowing at this point in time when each project would commence construction As the purpose of this analysis is to estimate the overall net benefit of the Program this simplification is not considered material

Ongoing Costs

Operating Maintenance and Administration (OMA) costs are the ongoing costs of provision of services for LWU These include maintenance management operational and energy and chemical costs The 2012-13 NSW Water Supply and Sewerage Performance Report has shown that the median Statewide Typical Residential Bill (TRB) is $1165 comprised of $840 (72 per cent) for OMA costs The remaining $325 (28 per cent) services the capital expenditure in order to meet borrowing costs and provide a return on assets (NSW Office Of Water 2014)

The estimated TRB for households that benefit from the Program have been estimated by LWUs as part of their Strategic Business Plans Assuming 72 per cent of the estimated TRB goes towards OMA costs and using the Office of Water assumption of 25 people per household the value of OMA costs have been estimated for the affected population for each project

These costs are offset in the analysis as benefits for the LWUs (a transfer between members of the referent group) with all utilities now achieving full cost recovery for water supply and 96 per cent for sewerage

Program Benefits

Whenever the water supply is compromised or whenever sanitation coverage is problematic the risk of disease particularly gastrointestinaldiarrhoeal disease is increased In NSW and elsewhere illnesses are more likely in small private water supplies in the absence of quality water supply and sewerage systems in systems that do not have risk-based drinking water management systems and locations that do not meet National Health and Medical Research Council (NHMRC) Guidelines health criteria The costs associated with illness include healthcare costs (both to the health system and patient) productivity costs due to lost activity

13 Including survey investigation design project management and contingency 27

in the workplace or home and mortality costs based on the estimated years of life lost by different age groups14

In addition households will be able to avoid current expenditure such as the costs of water filtration units water carting and septic tank and infiltration system maintenance

Incidence Rate of Gastroenteritis

The rate of incidence for gastroenteritis in Australia is assumed to be 074 casesperson per year equivalent to 159 million cases of gastroenteritis in the study year This is based on the results of the National Gastroenteritis Survey II 2008-2009 (NGSII) (Gibney Sinclair et al 2012 Kirk Glass et al 2014) For comparison the initial National Gastroenteritis Survey 2001-02 (NGSI) found an incidence rate of 092 casesperson per year equivalent to 172 million cases of gastroenteritis in the study year (Hall Kirk et al 2004)

The incidence rate of 074 casesperson per year reflects that a majority of the Australian population is serviced by a fully reticulated water supply and sewerage system that meets NHMRC guidelines as seen in major cities As such the incidence rate is likely to be higher in country towns that do not have access to such water and sanitation systems and those that do not meet NHMRC guidelines

It is estimated that water sanitation and hygiene interventions that seek to reduce diarrhoea and gastrointestinal infections will reduce overall incidence rates on average by 30 (corresponding to a relative risk of 070) This figure reflects meta-analyses of interventions that have found an overall incidence reduction ranging between 25-37 (relative risks ranging from 063 to 075) (Fewtrell Kaufmann et al 2005) In particular a meta-analysis of five studies that looked specifically at comparing sewerage systems with septic tanks found a reduction in incidence rates of 31 (relative risk of 069) while all 25 studies in this meta-analysis resulted in reduced incidence rates by 30 (Norman Pedley et al 2010) It is noted that these studies focus primarily on the incidence rates of diarrhoea and as such may underestimate the reduction in the total number of gastroenteritis cases if they present with non-diarrhoeal symptoms such as vomiting

If a reduction in incidence rates of 30 is expected the incidence figure of 074 casesperson per year is expected to be 70 of the incidence rate prior to intervention Consequently country towns that have had no intervention have estimated incidence rates of 106 casesperson per year The 30 improvement will thus see a reduction of 032 casesperson per year

Reduced Costs of Gastroenteritis

Benefits from interventions that improve water supply and sewerage systems reflect a reduced incidence rate of gastroenteritis leading to reduced expenditure on healthcare a reduced productivity loss with respect to both work and household activities and the reduced cost of mortality

A report prepared by Applied Economics Pty Ltd for the Australian Government Department of Health and Ageing uses the findings of the NGSI as a basis for calculating the costs of foodborne gastroenteritis to the economy (Applied Economics Pty Ltd 2006) While the report is focused on the cost of foodborne illness the figures for the per case cost of gastroenteritis have been used with the assumption that a case of gastroenteritis will have similar costs regardless of cause

However this approach may underestimate the reduction in costs as it does not take into consideration the different weighting between the number cases of gastroenteritis and severity If waterborne cases have a higher proportion of severe compared to mild cases or

14 In determining parameters Australian based studies have been used where possible with greater consideration also given to studies based on developed nations

28

the impact is more widespread than the average per case cost will be higher Furthermore country towns that experience a higher weighting of severe cases of gastroenteritis may also have higher costs of medical care compared to cities contributing to a higher average cost per case

Medical Costs

Total healthcare costs include hospitalisations visits to emergency departmentsgeneral practitionersspecialists diagnostic testing and pharmaceutical expenses The current healthcare cost per case of gastroenteritis is estimated to be $497415

Productivity Costs

Productivity losses are comprised of losses to workplace productivity and household activity and include both lost time for the individual due to illness or if the individual is acting as a carer for someone else who is ill

Absenteeism

Productivity loss due to sick days or absenteeism is equal to the amount of work days lost multiplied by average daily earnings16 and may be borne by the employer or employee depending on the nature of the employment contract

Figures from NGSII17 indicate that 089 work days (absenteeism) are lost per case of gastroenteritis In comparison a recent large national study in Germany found that each episode of acute gastroenteritis in adults resulted in 097 days of work lost (Wilking Spitznagel et al 2013) while a study of rotavirus gastroenteritis in children in European countries found the mean number of workings days lost by parents ranged from 23 to 75 (Van der Wielen Giaquinto et al 2010)

This CBA uses the NGSII 089 work days lost per case multiplied by average daily earnings ($22312) to estimate the cost of absenteeism at $20039 per case

Presenteeism

Estimates of workplace productivity losses should also consider the costs of presenteeism which refers to the situation when employees attend work while ill resulting in reduced labour productivity These costs may be as high as three-four times that of absenteeism or reduce overall average labour productivity by 25 (Medibank Private 2007 Comcare 2011) Work by The Center for Work and Health in the US have estimated the costs of presenteeism to be three times higher than the cost of absenteeism (Econtech Pty Ltd 2007 Medibank Private 2007 Medibank Private 2011)

In Australia research conducted by Econtech Pty Ltd estimated that the costs of absenteeism to the economy were $7 billion in 2005 while presenteeism costs to the economy were more than 35 times that at $257 billion in 2007 (Econtech Pty Ltd 2007)

15 The total healthcare costs in 2002 prices were divided by the number of cases to determine the average cost

per case and then estimates for 201314 prices were calculated using the Total Health Price Index published by the Australian Institute of Health and Welfare (2014) The 10-year trend annual growth rate up to 2012-13 the most recent year available was applied to estimate the 2013-14 Total Health Price Index and a growth rate from 2002-03 to 2013-14 calculated 16

Average daily earnings = average of the original May and November Total Weekly Earnings per Person for NSW in a financial year divided by five Australian Bureau of Statistics (2014) Average Weekly Earnings Australia cat no 63020 (Table 13A) 17

OzFoodNet and the National Centre for Epidemiology and Population Health (NCEPH) funded by the Australian Government Department of Health and New South Wales Food Authority conducted national cross-sectional surveys to estimate the national incidence of gastroenteritis meeting a specific case definition The surveys used computer assisted telephone interviews NGSI was conducted in 2001ndash2 while NGSII was conducted in 2008ndash9

The NGSIII included questions on the amount of work days and activity or household days lost which have been used with the value of the days lost to calculate the total productivity costs As the survey specifically asked the number of work days lost this explicitly accounts for cases of illness that may occur on weekends and for the level of employment

29

Advice from NSW Health on the duration of illness support the presenteeism multiplier with Cryptosporidium infection resulting in mild diarrhoea lasting four days moderate diarrhoea lasting 125 days and severe diarrhoea lasting 214 days (Gibney Sinclair et al 2012)

In addition the costs of presenteeism may also be greater if employees are still infectious leading to increased person-to-person transmissions

Gastroenteritis can also lead to the development of several further pathological conditions including Guillain-Barreacute syndrome (a progressive paralysis that can be fatal) irritable bowel syndrome and reactive arthritis (Applied Economics Pty Ltd 2006) While the latter two conditions may not be acute they have the potential to limit work productivity on an ongoing basis

Considering the factors above the costs of presenteeism for this CBA have been estimated as three times the per case cost of absenteeism

Household Time Lost

Loss of household activity reflects the days lost that would have been spent on activities other than work and Applied Economics have assumed a value of 50 of average daily earnings Results from NGSI17 indicate that 069 household days are lost per case of gastroenteritis (Applied Economics Pty Ltd 2006)

This CBA uses the NGSI 069 household days lost18 per case multiplied by half average daily earnings ($11156) to estimate the cost of household time lost at $7644 per case

With the latest figures for average daily earnings the current productivity cost per case of gastroenteritis is estimated to be $87799

Mortality Costs

Mortality costs reflect the cost of estimated years of life lost weighted by different age groups by Applied Economics to account for higher mortality in persons aged 65 and over The annual rate of Sydney CPI has been used to bring the 2004 estimate to 2013-14 prices

This CBA estimates the current mortality cost per case of gastroenteritis to be $2894

Total Reduced Costs of Gastroenteritis

The total cost avoided due to reduced cases of gastroenteritis is $95668 per case in 2013shy14 prices This cost per case multiplied by the reduction in casesperson per year yield the estimated reduced cost per person Thus the benefit associated with improved water and sewerage systems is reduced costs of $30340 per head of population covered by each project

In comparison a New Zealand estimate of the costs of foodborne infectious disease found the average cost per case of foodborne infectious disease to be AU$71801 (NZ$462 2000) Notably this study did not consider the costs of presenteeism but did consider medical costs loss of productivity and loss of life (Scott Scott et al 2000)

18 Published results from NGSII have not provided updated figures for the number of household days lost (Kirk

Glass et al 2014) NGSI is the most current figure available for this parameter 30

Summary of Reduced Costs of Gastroenteritis

Table 1 Summary of program benefits (2013-14)

Impact of Project CasesPerson per Year

Rate of Diarrhoeal Disease Without Projects 106

30 Reduction in Cases Due to Improved Conditions19

-032

Base Incidence Rate of Diarrhoeal Disease in Australia20

074

Costs of Gastroenteritis Per Case21 $case

Hospital Costs $627

EDGPSpecialist Visits $3476

Other Costs $871

Healthcare Costs $4974

Absenteeism $20039

Presenteeism $60116

Household Time Lost $7644

Productivity Costs $87799

Mortality Costs $2894

Total Costs $95668

Benefits from Reduced Gastroenteritis Per Person22 $person

Total Costs Avoided $30340

Residual Value

The NSW Office of Water has advised an average expected life of 80 years for the projects The residual value of the infrastructure has been calculated using straight-line depreciation as there are no estimates for profit or cash flow to enable alternate methods Thus the residual value from 2047-48 has been calculated as 625 of the initial capital costs in real terms

Avoided Household Expenditure

The 62 projects considered have been sorted into one of four categories based on their goal If projects are completed the impacted population23 will then be able to avoid different levels of expenditure depending on their current situation Estimates have been provided by the NSW Office of Water

19 Fewtrell L et al (2005) Water sanitation and hygiene interventions to reduce diarrhoea in less developed

countries - a systematic review and meta-analysis Lancet Infect Dis 5 42-52 Norman G et al (2010) Effects of sewerage on diarrhoea and enteric infections a systematic review and meta-analysis Lancet Infect Dis 10 536-544 20

Kirk M et al (2014) Foodborne illness in Australia Annual incidence circa 2010 Australian Government Department of Health New South Wales Food Authority and Food Standards Australia New Zealand 21

Applied Economics Pty Ltd (2006) The annual cost of foodborne illness in Australia Australian Government Department of Health and Ageing

Average costs per case of gastroenteritis have been calculated in 2002 (medical costs) or 2004 (productivity and mortality costs) and then a relevant index has been used to bring them to 2013-14 prices 22

Calculated as the reduction in casesperson per year multiplied by the value of the cost of gastroenteritis per case Calculations have been made prior to rounding 23

NSW Office of Water assumption of 25 peoplehousehold 31

1 Water Upgrade Project

Involves upgrading the water supply system in order to meet NHMRC guidelines on health criteria Households will be able to avoid expenditure on kitchen tap filtration systems with an average capital cost of $400 every 10 years and $200year spent each year on filter cartridges per household The estimated annual household expenditure used in this CBA is therefore $240household24

2 Water Provision Project

Involves the provision of a reticulated water supply Households will be able to avoid expenditure on purchasing waterwater carting The estimated annual household expenditure used in this CBA is $750household25

3 Sewerage Augmentation Project

Involves the upgrading of existing sewerage system impacting on health and sewerage effluent management Under these circumstances households are unlikely to incur extra expenditure

4 Sewerage Provision Project

Involves the provision of sewerage services to an unsewered community Households without sewerage services generally operate septic tanks and costs incurred include desludging of the tank costing $1500 every three years and restoration of the septic pits costing $3000 every 10 years Some households with septic tanks may face much higher annual costs including those that are prevented from having septic pits and must regularly empty their septic tanks (similar to regular garbage collection) resulting in costs of $2000household per year This CBA therefore assumes that households in this category spend $800household per year on desludging and restoring their septic systems26

As the majority of this work would be undertaken by local tradespeople all household costs have been discounted by 10 per cent in accordance with previous agreement with NSW Treasury

Table 2 Summary of Household Expenditure

Type of Project Type of Expenditure Benefit from Reduced Per Person Expenditure ($year)27

Water Upgrade Water Filtration $8640

Water Provision Water Carting $27000

Sewerage Augmentation No additional expenditure na

Sewerage Provision Septic Tank Costs $28800

Additional Unquantified Benefits

Productivity costs

Use of the average daily earnings to calculate productivity losses are likely to underestimate the true economic cost due to additional administration and lost productivity costs (Corso Kramer et al 2003 Pidd Berry et al 2006)

Epidemic Risk

24 Annual Expenditure on Water Filtration = $40010 + $200 = $240household per year

25 NoW advises that water carting for 16 regional towns in 2013 and 2014 had a median cost of $25kL [range $11

to $60kL] The median household water use was 500Ld for these towns For an average of 60 days of water cartingyear this would result in an annual cost of $750household [60 x 05kL x $25kL] 26

Annual Expenditure on Septic Tank Maintenance = $15003 + $300010 = $800household per year 27

Benefit = Total Household Expenditureyear25x09 32

The incidence rates used to calculate the benefits of reduced cases of gastroenteritisdiarrhoea refer to the endemic or underlying risk in contracting these illnesses Epidemic risks or outbreaks while rare are still possible in developed nations including Australia

For instance the hepatitis outbreak of Wallis Lake in 1997 was linked to septic tank effluent contamination of oysters Consumption of these oysters was responsible for an estimated 444 cases of hepatitis A across Australia including 274 cases in New South Wales Nearly one in seven cases was hospitalised with one mortality recorded In addition to the healthcare costs oyster producers the local fishing industry and accommodation sector were estimated to have lost net income of $17 million in 1997 (Applied Economics Pty Ltd 2006)

In 1993 a waterborne cryptosporidium outbreak in Milwaukee Wisconsin was caused by ineffective filtration of drinking water It affected an estimated 403000 residents with an average cost of illness of US$239 per person including medical and productivity costs for a total cost of US$962 million However this cost estimate is likely to be conservative as there are some medical costs there were unable to be captured with the costs of tourists and visitors not considered while productivity losses may have been greater if they extended beyond the four-month scope of the study (Corso Kramer et al 2003)

In Walkerton Canada there was a serious outbreak of E coli due to farm run off contaminating a drinking well in 2000 This incident resulted in thousands of cases of illness and seven deaths and cost CA$65 million There was little effort to protect the source water from faecal contamination deficient chlorination practice and a failure to respond to poor test results (Livernois 2002 OrsquoConnor 2002)

More recently in August 2009 there was a large outbreak following the contamination of drinking water in the privately operated ski resort of Smiggin Holes NSW Healthrsquos investigation found that more than 370 of approximately 800 people developed gastroenteritis in a single week

The inability to quantify the risk of epidemic outbreak in this analysis results in significant underestimation of not only the avoided health and productivity costs but also community state and national reputation A town that is known not to have water quality or sewerage systems that meet health standards is less likely to attract business investment and tourists which results in foregone household income

Environmental Damage

Sewerage systems and treatment plants may reduce environmental damage associated with untreated discharge into waterways In addition to the public health benefits this may also avoid losses of recreational utility and reduce environmental damage For instance untreated discharge can be responsible for increases nitrogen levels in waterways leading to algal blooms which are disruptive to the ecological balance in the receiving waters

Untreated upstream sewage discharges into rivers can detrimentally affect downstream users of these rivers especially if the water is their primary source of drinking water andor is used for recreational activities which could pose a public health risk and add to the costs of treatment

In addition waterways polluted with partially treated or untreated sewage can severely affect oyster farming and other aquacultural activities that are located downstream of the discharge points leading to outbreaks of illness within the community and erosion of economic viability of these industries

Indexation and Discount Rate

33

Consistent with the NSW Government Guidelines for Economic Appraisal (p52) the costs and benefits of the proposed project have been converted to present values assuming a real discount rate of 7 per cent per annum

However some of the cost bases are growing at different rates to inflation and a more suitable index is available These costs have been indexed by the relevant 10-year trend annual growth rate28 in order to maintain its current value and then discounted by a nominal discount rate of 967 per cent to achieve a 7 per cent real discount rate29

1 Healthcare Costs by 272 per cent based on the Total Health Price Index from 2002shy03 to 2012-13 (Australian Institute of Health and Welfare 2014)

2 Productivity Costs by 329 per cent based on the NSW Total Average Weekly Earnings from 2003-04 to 2013-14 (average of November and May data) (Australian Bureau of Statistics 2014)

3 Mortality Costs by 25 per cent with inflation assumed as the midpoint of the Reserve Bank of Australia target band

4 Construction Costs by 278 per cent based on the NSW Output of the Construction industries index from 2003-04 to 2013-14 (average of four quarters) (Australian Bureau of Statistics 2014)

OMA costs Typical Residential Bills (TRBs) and avoided household expenditure have been held constant over time and discounted by a 7 per cent real discount rate Where applicable the average rate of inflation over the time period has been assumed as 25 per cent the midpoint of the target band

Sensitivity testing has been undertaken using 4 per cent and 10 per cent as the real discount rate

Analysis Period

A project period of 30 years has been adopted for the analysis It has been assumed that all costs are incurred in 2016-17 (Year 3) It is further assumed that benefits begin the year after construction in 2017-18 (Year 4) and continue for 30 years ending in 2046-47 (Year 33) Residual benefits from the constructed capital are then calculated for 2047-48 (Year 34)

Results and Discussion

On the basis that no subsidy will be made available to LWUs for the 62 projects in the absence of the CTWSSP and that these projects will not be undertaken without such a subsidy 52 (84 per cent) of the projects are estimated to provide a positive return to the NSW Governmentrsquos contribution with a program-wide net benefit (sum of the 62 projects) of $174 million (net present value) with a benefit-cost ratio (BCR) of 154


However caution is recommended when considering these estimates as there are a number of reasons to believe them to be significant underestimates First many of the benefit parameters are conservative as has been explained in the ldquoProgram Benefitsrdquo section Secondly there are numerous benefits that have not been able to be quantified particularly the reduced risk of epidemic and environmental damage Lastly the lsquoco-paymentrsquo design of the CTWSS Program encourages LWUs to carefully consider community benefits before

28 Calculated using Excelrsquos LOGEST function which returns statistical information on the exponential curve of best

fit through a supplied set of x- and y-values 29

Nominal discount rate for real rate of 7 assuming 25 (midpoint of target band) inflation = 107x103 ndash 1 = 1021

34

deciding on whether to proceed with a subsidised project and this will significantly improve overall Program net benefit

This latter point requires further explanation Each LWU will decide whether or not individual projects will proceed based on its assessment of the projectrsquos net benefits from the local communityrsquos perspective As LWUs are best placed to make such assessments it is probable that many projects will be deemed by LWUs to generate benefits that were not able to be quantified in this analysis Consequently LWUs may choose to proceed with some projects that have been estimated in this analysis to result in net costs because the LWU has concluded that total project benefits exceed costs Hence the proportion of projects that yield positive net benefits is likely to have been underestimated above

Similarly the estimated total program net benefit estimates above are also likely to be underestimated as they assume that all 62 projects will be undertaken The fact that LWUs ultimately decide which projects proceed will likely result in the ex post program net benefit rising as those projects with the greatest net benefits are most likely to be undertaken while those with the greatest net costs are less likely to be undertaken Hence project self-selection by LWUs will improve overall program net benefits

While the above program-wide results for both the return to the NSW Government contribution and total capital cost are considered to be significant underestimates of the eventual net benefits of the program the program is nevertheless predicted to yield net benefits on both measures Given that most projects that are estimated to result in net costs are only marginally negative (see Appendix C2) and that the program-wide results are likely to be improved upon through project self-selection by LWUs it is recommended that the maximum level of Government subsidy of $112 million be made available to ensure that LWUs are given the choice of proceeding with all projects and therefore enabling self-selection efficiencies to be realised It is recognised that this approach may result in some uncommitted funds if projects are not undertaken

Sensitivity Analysis

As per the NSW Government Guidelines for Economic Appraisal (TTP07-5) the government costs and benefits of the proposed projects have been converted to present values assuming a real discount rate of 7 per cent per annum As recommended by the Guidelines sensitivity testing has been undertaken using 4 per cent and 10 per cent as the real discount rate

Table 3 Sensitivity to real discount rate for NSW Government contribution costs

Discount Rate Discount Rate Discount Rate 4 7 10

(default)

Percentage of 62 Projects with Positive NPV

97 84 56

Program NPV ($ million) $174 $329 $94

Program BCR 152 171 137

As shown in the table above while the results demonstrate some sensitivity to discount rate the project represents a net increase in economic welfare based on the Governmentrsquos contribution for all tested discount rates

35

Recommendation

Assuming that no CTWSSP projects will not proceed without financial assistance from the NSW Government this analysis estimates that extension of the program would result in a net benefit from the NSW Governmentrsquos contribution ($174 million) and from the total capital cost ($37 million) As the above estimates are considered underestimates because (i) conservative benefit parameters were used (ii) some benefits could not be quantified and (iii) project self-selection will result in only those projects generating benefits being undertaken it is recommended that the NSW Government make available the maximum level of contribution ($112 million) under the Program for the 62 identified projects

Nathan Lee Angus Bristow Analyst Economic Statistics amp Analysis Senior Manager Economic Statistics amp Analysis Strategic Policy amp Economics Strategic Policy amp Economics Tel 6391 3605 Date 24102014

Stewart Webster Director Investment Appraisal Statistical Analysis amp Research Strategic Policy amp Economics

36

Appendix C1 ndash CBA Results

Table 4 Summary of CBA Results (considering NSW Government Contribution 7 real discount rate)

Local Water Utility Project Name Type of NPV ($ BCR Project 000)

1 Essential Water Broken Hill Sewerage Effluent Sewerage 61189 269 Management Augmentation

2 Lachlan Shire Council Lachlan Shire Sewerage Sewerage 23925 267 Effluent Management Augmentation

3 Cobar Shire Council Cobar Water Supply Water Upgrade 16167 217 Augmentation

4 Wentworth Shire Wentworth Shire Sewerage Sewerage 11238 227 Council Scheme Augmentation

5 Bourke Shire Council Bourke Sewerage Effluent Sewerage 6228 200 Management Augmentation

6 Bourke Shire Council Bourke Water Supply Water Upgrade 6179 146 Augmentation

7 Oberon Council Oberon Sewerage Sewerage 5939 177 Augmentation

8 Warrumbungle Shire Coonabarabran Sewerage Sewerage 5869 165 Council Augmentation Augmentation

9 Murrumbidgee Shire Darlington Pt Water Supply Water Upgrade 3733 255 Council

10 Tamworth Regional Barraba Sewerage Sewerage 3683 178 Council Augmentation

11 Narrabri Shire Council Wee Waa Sewerage Sewerage 3285 142 Augmentation

12 Weddin Shire Council Grenfell Sewerage Sewerage 3243 137 Augmentation

13 Jerilderie Shire Council Jerilderie Water Supply Water Upgrade 3055 166 Augmentation

14 Carrathool Shire Council Hillston Sewerage Sewerage 2630 177 Augmentation

15 Essential Water Menindee Water Supply Water Upgrade 2365 184

16 Wagga Wagga City San Isidore Sewerage Sewerage 1708 228 Council Provision

17 MidCoast County Coomba Park Sewerage Sewerage 1468 111 Council Provision

18 Moree Plains Shire Ashley Water Supply Water Provision 1367 163 Council

19 Yass Valley Council Bowning Sewerage (Yass Sewerage 1188 135 Villages) Provision

20 Warrumbungle Shire Coolah Sewerage Sewerage 1184 129 Council Augmentation

21 Wingecarribee Shire Yerrinbool Sewerage Sewerage 1141 110 Council Provision

22 Uralla Shire Council Bundarra Sewerage Sewerage 1041 133 Provision

23 Coolamon Shire Council Ardlethan Sewerage Sewerage 962 130 Provision

24 MidCoast County North Arm Cove Sewerage Sewerage 951 114 Council Provision

25 Mid-Western Regional Charbon Sewerage Sewerage 894 121 Council Provision

26 Essential Water Silverton Water Supply Water Provision 763 120

27 MidCoast County Pindimar Sewerage Sewerage 629 115 Council Provision

28 Walgett Shire Council Cumborah Water Supply Water Provision 602 181

29 Eurobodalla Shire Mystery Bay Sewerage Sewerage 542 115 Council Provision

37


30 Griffith City Council Lake Wyangan Sewerage Sewerage 524 132 Provision

31 Narrandera Shire Barellan Sewerage Sewerage 521 113 Council Provision

32 Port Macquarie- Telegraph Point Sewerage Sewerage 514 123 Hastings Council Provision

33 Eurobodalla Shire Nelligen Sewerage Sewerage 488 116 Council Provision

34 Singleton Shire Council Bulga Water Supply Water Provision 464 123

35 Griffith City Council Tharbogang Sewerage Sewerage 403 149 Provision

36 Murray Shire Council Bunnaloo Water Supply Water Upgrade 399 179

37 MidCoast County Nerong Sewerage Sewerage 381 110 Council Provision

38 MidCoast County Allworth Sewerage Sewerage 379 111 Council Provision

39 Moree Plains Shire Biniguy Water Supply Water Provision 368 125 Council

40 Yass Valley Council Binalong Sewerage (Yass Sewerage 355 109 Villages) Provision

41 Wellington Council Stuart Town Water Supply Water Provision 323 139

42 MidCoast County Bundabah Sewerage Sewerage 263 110 Council Provision

43 Liverpool Plains Shire Wallabadah Sewerage Sewerage 200 103 Council Provision

44 Cabonne Council Yeoval Water Supply Water Upgrade 159 106

45 Eurobodalla Shire Potato Point Sewerage Sewerage 127 104 Council Provision

46 Eurobodalla Shire Congo Sewerage Sewerage 114 104 Council Provision

47 Leeton Shire Council Wamoon Sewerage Sewerage 83 104 Provision

48 Upper Hunter Shire Cassilis Sewerage Sewerage 58 103 Council Provision

49 MidCoast County Stroud Road Sewerage Sewerage 22 101 Council Provision

50 Port Macquarie- Comboyne Sewerage Sewerage 18 101 Hastings Council Provision

51 Port Macquarie- Long Flat Sewerage Sewerage 8 100 Hastings Council Provision

52 Liverpool Plains Shire Willow Tree Sewerage Sewerage 5 100 Council Provision

53 Eurobodalla Shire Central Tilba Sewerage Sewerage -175 094 Council Provision

54 Warren Shire Council Warren Sewerage Sewerage -273 098 Augmentation

55 Griffith City Council Nericon Sewerage Sewerage -292 078 Provision

56 Warrumbungle Shire Mendooran Sewerage Sewerage -352 092 Council Provision

57 Singleton Shire Council Camberwell Water Supply Water Provision -425 081

58 Kempsey Shire Council Bellbrook Sewerage Sewerage -565 088 Provision

59 Clarence Valley Council Ulmarra Sewerage Sewerage -692 091 Provision

60 Lachlan Shire Council Tottenham Water Supply Water Upgrade -741 086

61 Central Darling Shire White Cliffs Water Supply Water Upgrade -921 080 Council

38

Local Water Utility Project Name Type of Project

NPV ($ 000)

BCR

62 Kempsey Shire Council Stuarts Point Grassy Head Sewerage

Sewerage Provision

-1322 090

SUM OF 62 PROJECTS 173587 152

39

Appendix C2 ndash Individual Project NPV Chart

Figure 1 Government Contribution Cost NPV ($ lsquo000)

-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000

Stuarts Point Grassy Head Sewerage

White Cliffs Water Supply

Tottenham Water Supply

Ulmarra Sewerage

Bellbrook Sewerage

Camberwell Water Supply

Mendooran Sewerage

Nericon Sewerage

Warren Sewerage

Central Tilba Sewerage

Willow Tree Sewerage

Long Flat Sewerage

Comboyne Sewerage

Stroud Road Sewerage

Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage

Potato Point Sewerage

Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage

Stuart Town Water Supply

Binalong Sewerage (Yass Villages)

Biniguy Water Supply

Allworth Sewerage

Nerong Sewerage

Bunnaloo Water Supply

Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage

Telegraph Point Sewerage

Barellan Sewerage

Lake Wyangan Sewerage

Mystery Bay Sewerage

Cumborah Water Supply

Pindimar Sewerage

Silverton Water Supply

Charbon Sewerage

North Arm Cove Sewerage

Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage

Bowning Sewerage (Yass Villages)

Ashley Water Supply

Coomba Park Sewerage

San Isidore Sewerage

Menindee Water Supply

Hillston Sewerage

Jerilderie Water Supply Augmentation

Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage

Darlington Pt Water Supply

Coonabarabran Sewerage Augmentation

Oberon Sewerage

Bourke Water Supply Augmentation

Bourke Sewerage Effluent Management

Wentworth Shire Sewerage Scheme

Cobar Water Supply Augmentation

Lachlan Shire Sewerage Effluent Management

Broken Hill Sewerage Effluent Management

Government Cost NPV ($ 000)

Figure 2 Total Capital Cost NPV ($ lsquo000)

40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage







Total Capital Cost NPV ($ 000)

41

Benefit Cost Analysis Bibliography Applied Economics Pty Ltd (2006) The annual cost of foodborne illness in Australia Australian Government Department of Health and Ageing

Australian Bureau of Statistics (2014) Average Weekly Earnings Australia cat no 63020 (Table 13A)

Australian Bureau of Statistics (2014) Producer Price Indexes Australia cat no 64270 (Table 17)

Australian Institute of Health and Welfare (2014) Health Expenditure Australia 2012-13

Comcare (2011) Benefits To Business-the evidence for investing in worker health and wellbeing

Corso P S et al (2003) Cost of Illness in the 1993 Waterborne Cryptosporidium Outbreak Milwaukee Wisconsin Emerging Infectious Diseases 9(4)

Econtech Pty Ltd (2007) Economic modelling of the cost of presenteeism in Australia Medibank Private

Fewtrell L et al (2005) Water sanitation and hygiene interventions to reduce diarrhoea in less developed countries - a systematic review and meta-analysis Lancet Infect Dis 5 42shy52

Gibney K B et al (2012) Establishing Australian Health-Based Targets for Microbial Water Quality Water Quality Research Australia Ltd Final Report 100409

Hall G et al (2004) Results from the National Gastroenteritis Survey 2001 ndash 2002 National Centre for Epidemiology amp Population Health

Kirk M et al (2014) Foodborne illness in Australia Annual incidence circa 2010 Australian Government Department of Health New South Wales Food Authority and Food Standards Australia New Zealand

Livernois J (2002) The Economic Costs of the Walkerton Water Crisis Ontario Ministry of the Attorney General

Medibank Private (2007) Sick at work The cost of presenteeism to your business employees and the economy

Medibank Private (2011) Sick at Work The cost of presenteeism to your business and the economy

Norman G et al (2010) Effects of sewerage on diarrhoea and enteric infections a systematic review and meta-analysis Lancet Infect Dis 10 536-544

NSW Office Of Water (2014) 2012-13 NSW Water Supply and Sewerage Performance Monitoring Report

OrsquoConnor D R (2002) Walkerton Report Part 1 Ontario Ministry of the Attorney Genera

Pidd K J et al (2006) Estimating the cost of alcohol-related absenteeism in teh Australian workforce-the importance of consumption patterns Medical Journal of Australia 185(1112)

Scott W G et al (2000) Economic cost to New Zealand of foodborne infectious disease NZ Med J 113 881-884

42

Van der Wielen M et al (2010) Impact of community-acquired paediatric rotavirus gastroenteritis on family life data from the REVEAL study BMC Fam Pract 11(22)

Wilking H et al (2013) Acute gastrointestinal illness in adults in Germany a population-based telephone survey Epidemiol Infect 141 2365-2375

43


benefits of each option relative to the base case of lsquono programrsquo and where these benefits and costs have

been quantified a comparison of the net benefit and benefit-cost ratio (BCR) of each option

Quantitative analysis has convincingly demonstrated that both Option 1 and Option 2 provide benefits to

the community in excess of their costs The preferred option was Option 2 extending of the existing

CTWSS Program for a further 5 years to 2022 Option 2 would continue to provide expert advice technical

support and training to LWUs and financial assistance to LWUs towards the capital cost of 71 remaining

unfunded water and sewerage backlog projects

Option 3 would address emerging cryptosporidium risks and the impacts of climate variability and

environmental flows on security of water supplies This option warrants further development and analysis

of its likely costs and benefits

Cost recovery

The evaluation assessed the existing program pricing arrangements relative to the cost recovery

principles outlined by the Productivity Commission in its 2001 Inquiry Report on Cost Recovery by

Government Agencies The evaluation found that the provision of technical support and financial

assistance is in response to the positive externalities from providing strategic planning expert technical

advice and the achievement of desired minimum health standards through infrastructure provision

Application of the Productivity Commissionrsquos cost recovery principles to the existing program indicates that

this program should continue to not be cost recovered This finding would likewise apply to Option 2

Performance Measures

Key performance measures and indicators measure program performance and progress towards meeting

government policy objectives They demonstrate how effective a program is in producing the required

outputs and achieving the desired outcomes

A number of output and outcome performance measures are proposed for the CTWSS Program These

measures are based on achieving the prescribed positive externalities (due to the public good market

failure) of providing assistance to LWUs to achieve minimum water related health standards through

effective and efficient service provision Examples of the Programs outcome measures and indicators

include the

water supply coverage () and sewerage coverage () in regional NSW

number of people benefiting from improved water supplysewerage systems under the program

proportion of LWU microbiological samples complying with Australian Drinking Water Guidelines and

proportion of urban population in regional NSW with an Australian Drinking Water Guidelines compliant public drinking water supply

Future Evaluations

This is the first evaluation of the CTWSS Program as part of the regular Departmental cycle of evaluations

informed by the NSW Government Evaluation Framework As such the evaluation concentrated on the

qualitative aspects of lsquoformativersquo evaluation to build the capacity of program management to monitor

programrsquos performance in the future ndash problem identification program logic and performance measure

design Data collection continues to enable quantitative lsquosummativersquo evaluation of the Program when it is

next scheduled for evaluation under the Framework

More information

Further information on the CTWSS Program can be obtained from

DPI Water Postal address NSW DPI Locked Bag 5123 Parramatta NSW 2124 Phone 1800 353 104 Email waterenquiriesdpinswgovau Website httpwwwwaternswgovauurban-watercountry-town-water

INT1652743 copy State of New South Wales through the NSW Department of Industry Skills and Regional Development 2016 You may copy distribute

and otherwise freely deal with this publication for any purpose provided that you attribute the NSW Department of Industry Skills and Regional

Development as the owner

Disclaimer The information contained in this publication is based on knowledge and understanding at the time of writing (January 2015) However

because of advances in knowledge users are reminded of the need to ensure that information upon which they rely is up to date and to check currency

of the information with the appropriate officer of the NSW Department of Industry Skills and Regional Development or the userrsquos independent advisor





























requirements

























sewerage disposal



















3 of the NSW Auditor-Generalrsquos Report is shown in Appendix A on page 21


























Not applicable















Policy Alignment

a NSW 2021 goal4













servicesrdquo



4






















Option 1

The existing

CTWSS

program

Description



broad elements




























treatment works





5












Policy 3

Dam safety 2



Regional staff 10









2017-18






2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0































approved budget



Technical Support













































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43




























requirements

























sewerage disposal













































Not applicable















Policy Alignment

a NSW 2021 goal4













servicesrdquo



4






















Option 1

The existing

CTWSS

program

Description



broad elements




























treatment works





5












Policy 3

Dam safety 2



Regional staff 10









2017-18






2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0































approved budget



Technical Support













































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43
























sewerage disposal













































Not applicable















Policy Alignment

a NSW 2021 goal4













servicesrdquo



4






















Option 1

The existing

CTWSS

program

Description



broad elements




























treatment works





5












Policy 3

Dam safety 2



Regional staff 10









2017-18






2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0































approved budget



Technical Support













































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43
































Not applicable















Policy Alignment

a NSW 2021 goal4













servicesrdquo



4






















Option 1

The existing

CTWSS

program

Description



broad elements




























treatment works





5












Policy 3

Dam safety 2



Regional staff 10









2017-18






2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0































approved budget



Technical Support













































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43






















Option 1

The existing

CTWSS

program

Description



broad elements




























treatment works





5












Policy 3

Dam safety 2



Regional staff 10









2017-18






2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0































approved budget



Technical Support













































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43












Policy 3

Dam safety 2



Regional staff 10









2017-18






2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0































approved budget



Technical Support













































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43




2014-15 $39016M

2015-16 $29661M

2016-17 $28948M

2017-18 $0































approved budget



Technical Support













































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43











































7





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43





























Option 2

Extended

CTWSS

Program

Description


Background

















As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43






As in Option 1


As in Option 1


As in Option 1





Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43


Option 3

Broadened

CTWSS

Program to

address

cryptosporidi

um risks and

water

security

Description





towns










regional NSW























As in Option 1


As in Option 1



8




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43




















impact





productivity losses








2017-18 $0 Total of $9764M



Option 2










Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43


Option 3





tourism benefits





















Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43







Appendix C



Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43

Executive Summary



capital costs and


has been completed




o healthcare costs


o mortality costs
















Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43





Background 25



Program Costs 27

Capital Costs 27

Ongoing Costs 27

Program Benefits 27




Residual Value 31




Analysis Period 34



Recommendation 36



Bibliography 42


Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43

Background










25












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43












Shire Council














26

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43

Program Costs

Capital Costs





Ongoing Costs




Program Benefits















28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43













28


Medical Costs


Productivity Costs


Absenteeism




Presenteeism








29





Household Time Lost




Mortality Costs













-032


074


Hospital Costs $627


Other Costs $871


Absenteeism $20039

Presenteeism $60116




Total Costs $95668



Residual Value



























Productivity costs


Epidemic Risk

















33









Analysis Period









34









(default)


97 84 56




35

Recommendation




36

































37


































38


NPV ($ 000)

BCR


Sewerage Provision

-1322 090


39



-5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 65000




Ulmarra Sewerage

Bellbrook Sewerage


Mendooran Sewerage

Nericon Sewerage

Warren Sewerage



Long Flat Sewerage

Comboyne Sewerage


Cassilis Sewerage

Wamoon Sewerage

Congo Sewerage


Yeoval Water Supply

Wallabadah Sewerage

Bundabah Sewerage




Allworth Sewerage

Nerong Sewerage


Tharbogang Sewerage

Bulga Water Supply

Nelligen Sewerage


Barellan Sewerage




Pindimar Sewerage


Charbon Sewerage


Ardlethan Sewerage

Bundarra Sewerage

Yerrinbool Sewerage

Coolah Sewerage


Ashley Water Supply




Hillston Sewerage


Grenfell Sewerage

Wee Waa Sewerage

Barraba Sewerage



Oberon Sewerage









40

-15000 -10000 -5000 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000



Wallabadah Sewerage

Warren Sewerage

Ulmarra Sewerage


Yerrinbool Sewerage

Bellbrook Sewerage



Nerong Sewerage


Charbon Sewerage

Pindimar Sewerage

Mendooran Sewerage

Allworth Sewerage





Bundabah Sewerage

Congo Sewerage





Long Flat Sewerage

Bulga Water Supply

Cassilis Sewerage

Barellan Sewerage

Nelligen Sewerage

Comboyne Sewerage

Wamoon Sewerage

Yeoval Water Supply

Nericon Sewerage




Ardlethan Sewerage

Bundarra Sewerage

Coolah Sewerage

Grenfell Sewerage

Ashley Water Supply


Tharbogang Sewerage




Wee Waa Sewerage


Hillston Sewerage

Barraba Sewerage




Oberon Sewerage








41




















42



43

evaluation of the country towns water supply and sewerage

Documents